RSPO Report-PT Socfin Bangun Bandar RSPO20008

7/28/2019 RSPO Report-PT Socfin Bangun Bandar RSPO20008

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COMMERCIAL- IN CONFIDENCE

The contents of this report must not be di sclosed to a third party without the agreement of the SAI Global Client

DISCLAIMER:This report has been prepared by SAI Global Indonesia (SAI Global) in respect of a Client's application for assessment by SAI Global. The purpose of the report is to comment upon

evidence of the Client's compliance with the standards or other criteria specified. The content of this report applies only to matters, which were evident to SAI Global at the time ofthe audit within the audit scope. SAI Global does not warrant or otherwise comment upon the suitability of the contents of the report or the certificate for any particular purpose oruse. SAI Global accepts no liability whatsoever for consequences to, or actions taken by, third parties as a result of or in reliance upon information contained in this report or

certificate.

ACTIVITY ID: 337877QEF08sa.RSPO.01 / Issue Date: 2009-Apr-15 SAI Global Indonesia Copyright 2009 Page 1 of 58

App./Cert. RSPO20008

Date 16/05/2011

Rev.01: 19 October

2011

PUBLIC SUMMARY REPORT

Client: PT. SOCFIN INDONESIA Bangun Bandar Mill and Its

Supply BasesSite Address: Bangun Bandar Mill:

Kecamatan Dolok Masihul Kabupaten SERDANGBEDAGAI 206691 IDN

Its supply bases:

Kecamatan Dolok Masihul Kabupaten SERDANGBEDAGAI 206691 IDN

Standard(s): National Interpretation of RSPO Principles and Criteria for Sustainable PalmOil Production, Republic of Indonesia, May 2008

Supply Chain Certification System (SCCS) Requirements

Scope of Certification:


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COMMERCIAL- IN CONFIDENCE

The contents of this report must not be di sclosed to a third party without the agreement of the SAI Global Client

DISCLAIMER:This report has been prepared by SAI Global Indonesia (SAI Global) in respect of a Client's application for assessment by SAI Global. The purpose of the report is to comment upon

evidence of the Client's compliance with the standards or other criteria specified. The content of this report applies only to matters, which were evident to SAI Global at the time ofthe audit within the audit scope. SAI Global does not warrant or otherwise comment upon the suitability of the contents of the report or the certificate for any particular purpose oruse. SAI Global accepts no liability whatsoever for consequences to, or actions taken by, third parties as a result of or in reliance upon information contained in this report or

certificate.

ACTIVITY ID: 337877QEF08sa.RSPO.01 / Issue Date: 2009-Apr-15 SAI Global Indonesia Copyright 2009 Page 2 of 58

Bangun Bandar Mill PT. Socfin IndonesiaLocation: Kecamatan Dolok Masihul, Kabupaten Serdang Bedagai 20691, Sumatera Utara,Indonesia

GPS Location: East 992'34.80'' North 3019'54.73''

Capacity (annual MT CPO): CPO: 12,721.78 ton in 2010PK: 2,418.28 ton in 2010

Bangun Bandar Estate PT. Socfin IndonesiaLocation: Kecamatan Dolok Masihul, Kabupaten Serdang Bedagai 20691, Sumatera Utara,IndonesiaGPS Location: East 98o5758.70 99o436.33

North 3o1624.46 3o2032.54FFB Production: 53.628,01 ton in 2010Total Area : 4146.85 Ha

Planted Area : 2918.69 Ha


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QEF08sa.RSPO.01 / Issue Date: 2009-Apr-15 SAI Global Indonesia Copyright 2009 Page 3 of 58

Table of contents PageExecutive Overview 4Abbreviations Used 4

1.0 SCOPE OF THE CERTIFICATION ASSESSMENT 51.1 Introduction 51.2 Audit Objective 51.3 Scope of Certification 51.4 Location of Mill and Estates 61.5 Description of Supply Base 101.6 Date of Plantings 101.7 Other Certificates Held 111.8 Organisational Information/Contact Person 111.9 Time Bound Plan for Other Management Units 111.10 Area of Plantation 12

1.11 Approximate Tonnages Offered for Certification (CPO and PK) 131.12 Date of Issue of Certificate and Scope of Certification 13

2.0 AUDIT PROCESS 132.1 Certification Body 132.2 Audit Methodology 142.3 Qualification of the Lead Auditor and Audit Team Members 142.4 Stakeholder Consultation 152.5 Date of Next Surveillance Visit 15

3.0 AUDIT FINDINGS 163.1 Summary of findings 16

3.2 Recommendation 433.3 Acknowledgement of Internal Responsibility and Formal Sign-off of Assessment

Findings43

List of TablesPage

1 Mill and Estates GPS Locations 62 Organisation FFB Production 103 Age Profiles of Planted Palms 104 Other Certificates Held by Mill and Estates 115 RSPO Certification Time Bound Plan of PT. Socfin Indonesia 126 Estates and Area Planted 127 Hectare Statement 12

List of Figures Page1 Map of Mill and Estates Location 72 Boundaries Pegs with Estate name 193 Martebing River with natural methods to slow down and stop aberration 234 Result of picking ofOryctesrhinoceros and its larva 255 Facility to mix agrochemicals 276 Watershed Protection 33

List of Appendices PageA Audit Record 44

B Nonconformities, Corrective Actions and Observations Summary 47C Stakeholders issues and comment 57D Definition of, and action required with respect to audit findings 58


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Executive Overview

SAI Global has audited PT. Socfin Indonesia operations comprising one mill, one oil palm estate,support services and infrastructure. PT. Socfin Indonesia operation was found complies with the

requirements of the National Interpretation of RSPO Principles and Criteria for Sustainable PalmOil Production, Republic of Indonesia, May 2008 and Supply Chain Certification System (SCCS)Requirements. The recommendation from this audit is that PT. Socfin Indonesia be approved as aproducer of RSPO Certified Sustainable Palm Oil and Palm Kernel.

Abbreviations Used

AK3U OHS Expert (Ahli Kesehatan dan Keselamantan Kerja Umum)ANDAL Environmental Impact Analysis (Analisis Dampak Lingkungan)BOD Biological Oxygen Demand

BPN National Land Agency (Badan Pertanahan Nasional)BPS Central Bureau of Statistic (Biro Pusat Statistik)CPO Crude Palm OilCSR Corporate Social ResponsibilityDO Delivery OrderEFB Empty fruit bunchesFFB Fresh Fruit BunchFRF Fractionation and Refinery FactoryGPS Global PositioningHCV High Conservation ValueHGU Land Use Title (Hak Guna Usaha)HPH Forest Authority Concession (Hak Penguasaan Hutan)

IPM Integrated Pest ManagementISO International Standards OrganisationKHT (Karyawan Harian Tetap)kWH Kilo Watt HourLCC Legume cover cropsMSDS Material Safety Data SheetMT Metric TonNGO Non Government OrganisationOHS Occupational Health and SafetyPOM Palm Oil MillPPE Personal Protective EquipmentPRA Participatory Rural Appraisal

PK Palm KernelPKB Joint Working Agreement (Perjanjian Kerja Bersama)PKOF Palm Kernel Oil FactoryPSBB Bangun Bandar Selection Center (Pusat Seleksi Bangun Bandar)RABQSA Quality Society of AustraliaRKL Environmental Management Plan (Rencana Pengelolaan Lingkungan)RPL Environmental Monitoring Plan (Rencana Pemantauan Lingkungan)RSPO Roundtable on Sustainable Palm OilSA Social AccountabilitySCCS Supply Chain Certification SystemSIO Operation License (Surat Izin Operasi)

SPSI Indonesian Worker Union (Serikat Pekerja Seluruh Indonesia)WWTP Waste Water Treatment Plant


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1.0 SCOPE OF THE CERTIFICATION ASSESSMENT

1.1 Introduction

SAI Global conducted an audit of PT. Socfin Indonesia Bangun Bandar Mill and Its Supply Baseson 10 to 12 and 16 May 2011.

The purpose of this audit report is to summarise the degree of compliance with relevant criteria, asdefined on the cover page of this report, based on the evidence obtained during the audit of yourorganisation.

SAI Global audits are carried out within the requirements of SAI Global procedures that also reflectthe requirements and guidance provided in the international standards relating to audit practicesuch as ISO/IEC 17021, ISO 19011, RSPO Certification System and other normative criteria. SAIGlobal Auditors are assigned to audits according to industry, standard or technical competenciesappropriate to the organisation being audited. Details of such experience and competency are

maintained in our records. The audit team is detailed in the attached audit record.

In addition to the information contained in this audit report, SAI Global maintains files for eachclient. These files contain details of organisation size and personnel as well as evidence collectedduring preliminary and subsequent audit activities (Documentation Review and Scope) relevant tothe application for initial and continuing certification of your organisation.

Details of your primary contact persons and their contact details and site addresses are alsomaintained. Please take care to advise us of any change that may affect theapplication/certification or may assist us to keep your contact information up to date, as required bySAI Global Terms and Conditions.

Please note that this report is subject to independent review and approval. Should changes to theoutcomes of this report be necessary as a result of the review, a revised report will be issued andwill supersede this report.

1.2 Audit Objective

Certification Audit

To determine the implementation of your organizations RSPO system; the capability andeffectiveness of the RSPO system in ensuring continual compliance with the requirements of the

National Interpretation of RSPO Principles and Criteria for Sustainable Palm Oil Production,Republic of Indonesia, May 2008 and Supply Chain Certification System (SCCS) Requirements.and in meeting its specified objectives (indicator); and the conformity of the RSPO system to statedprinciples, criteria and indicator.

1.3 Scope of certification

The scope of certification is the CPO production from one (1) Palm Oil Mill and one (1) FFBsupplybase owned by PT. Socfin Indonesia.

Bangun Bandar Mill PT. Socfin IndonesiaLocation: Kecamatan Dolok Masihul, Kabupaten Serdang Bedagai 20691, Sumatera Utara,IndonesiaGPS Location: East 99 2' 34.80'' North 3 19' 54.73''

Capacity (annual MT CPO): CPO: 12,721.78 ton in 2010


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PK: 2,418.28 ton in 2010

Bangun Bandar Estate PT. Socfin IndonesiaLocation: Kecamatan Dolok Masihul, Kabupaten Serdang Bedagai 20691, Sumatera Utara,

IndonesiaGPS Location: East 98o 5758.70 99o 436.33North 3o 1624.46 3o 2032.54

FFB Production: 53,628.01 ton in 2010Total Area: 4146.85 HaPlanted Area: 2918.69 Ha

1.4 Location of mill and estates

PT. Socfin Indonesia mill and estate are located in North Sumatera Province. The geographical

coordinate of the mill and estatesareshown on Table 1.

Table 1: Mill and Estates GPS Locations

MILL AND ESTATE EASTING NORTHING

Bangun Bandar Mill 99o 2 34.80 E 3o19 54.73 N

Bangun Bandar Estate 98o 57 58.70 - 99o 4 36.33 E 3o 16 24.46 3o 20 32.54 N


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Figure 1 Map of Mill and Estates Location


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1.5 Description of supply base

The FFB is sourced from one (1) organisation owned by PT. Socfin Indonesia. The hectare and

FFB production of the plantation is shown on Table 2.

Table 2: FFB Production of the supply base

ESTATE PLANTED AREA (HA) FFB (TON/YEAR)

Bangun Bandar 2,918.69 53,628.01

Source: Socfin Indonesia, March 2011

1.6 Date of plantings

Table 3: Age Profiles of Planted Palms

Year

Bangun Bandar Estate

Planted Area

(Ha)

% of Planted Area

Mature Immature Mature Immature

1984 43.54 1.49

1986 192.77 6.60

1988 45.29 1.55

1989 206.25 7.07

1990 174.79 5.99

1991 124.62 4.27

1992 72.56 2.49

1996 30.48 1.04

1998 141.81 4.86

1999 105.24 3.61

2000 100.83 3.45

2001 109.11 3.74

2002 34.16 1.17

2003 172.60 5.91

2004 257.22 8.81

2005 86.68 2.97

2006 123.50 4.23


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2007 21.65 0.74

2008 75.02 2.57

2009 351.51 12.04

2010 281.39 9.64

2011 167.67 5.74

Total 2,043.10 875.59 70.01 29.99

Grand Total 2,918.69 100.00


1.7 Other certification held

The organisation is implementing quality, environmental, and occupational health and safetymanagement system based on ISO 9001:2008, ISO 14001:2004, and OHSAS 18001:2007. Thedetails of other certifications held are shown in the following table.

Table 4: Certification Held by Mill and Estates

MILL/ESTATE ISO 9001:2008 ISO 14001:2004 OHSAS 18001:2007

Bangun Bandar Mill Since 2008 Since 2008 Since 2009

Bangun Bandar Estate Nil Since 2008 Since 2009

1.8 Organizational information/contact person

PT. Socfin IndonesiaJl. K.L. Yos Sudarso No. 106, Medan 20115Phone : (+62-61) 6616066Fax : (+62-61) 6614390Contact person : Mr. Hasan Bisri

Head of System Management and Social DepartmentEmail :[email protected]

1.9 Time bound plan for other management units

PT. Socfin Indonesia is committed to RSPO certification of all its Management Units located inNorth Sumatera and Nanggroe Aceh Darusallam. Time bound plan has been developed to achievethe RSPO certification for all its Management Units by 2013. The time bound detail was shown onTable5. The time bound plan is realistic and challenging. Number of Estates which is certified are

more than previous year. It was evident that the organisation is committed to meet the target thathad been set in the time bound plan.
mailto:[email protected]:[email protected]:[email protected]:[email protected]


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Table 5: RSPO Certification Time Bound Plan of PT. Socfin Indonesia, approved in May 2011

NO NAME OF MILL SUPPLY BASE LOCATION YEAR

1 Bangun Bandar Mill Bangun Bandar Estate North Sumatera 2011

2 Tanah Gambus Mill Tanah Gambus Estate North Sumatera 2011

3 Negeri Lama Mill Negeri Lama Estate North Sumatera 2012

4 Matapao Mill Matapao Estate North Sumatera 2012

5 Sungai Liput Mill Sungai Liput Estate Nanggroe AcehDarusallam

2012

6 Lae Butar Mill Lae Butar Estate Nanggroe AcehDarusallam

2013

7 Seunagan Mill Seunagan Estate Nanggroe AcehDarusallam

2013

8 Seumayam Mill Seumayam Estate Nanggroe AcehDarusallam

2013

9 Aek Loba Mill Aek Loba Estate

Padang Pulo Estate

North Sumatera 2013

Source: Socfin Indonesia, May 2011

1.10 Area of plantation

The areas details for organisation owned estates are shown on Table 6.

Table 6: Estates and Area Planted

ESTATE MATURE (HA) IMMATURE (HA)

Bangun Bandar 2,043.10 875.59Source: Socfin Indonesia, March 2011

Table 7: Hectare Statement

AREA HECTARES

Mature area 2,043.10

Immature area 875.59

Total area planted 2,918.69

Emplacement and Mill 32.09


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Nursery 3.81

Effluent, Isolation Drain 8.61

PLN 6.00

Conservation area 1.27

Bamboo 0.54

Other area 1,175.84

Total leased area 4,146.85


1.11 Approximate tonnages offered for certification (CPO and PK)

The approximate tonnages certified are: CPO/year: 12,721.78 ton and PK/year: 2,418.28 ton

1.12 Date of issue of certificate and scope of certification

The scope of certification is the CPO production from one (1) palm oil mill and one (1) organisationowned by PT. Socfin Indonesia.

Date of issue of certificate will be the date on approval of this Assessment Report by the RSPO

Secretariat.

2.0 AUDIT PROCESS

2.1 Certification body

PT. SAI Global IndonesiaGraha Iskandarsyah, 4th floorJl. Iskandarsyah Raya No. 66 CKebayoran Baru, Jakarta 12160, Indonesia

Phone : +62 21 720 6186, 720 6460Fax : +62 21 720 6207Contact person : Mr. Joko Prayitno

Certification ManagerEmail :[email protected]

SAI Global is one of the worlds leading business providers of independent assurance. SAI Globalprovides organisations around the world with information services and solutions for managing risk,achieving compliance and driving business improvement.

We provide aggregated access services to Standards, Handbooks, Legislative and Propertypublications; we audit, certify and register your product, system or supply chain; we facilitate good

governance and awareness of compliance, ethics and policy issues and provide training andimprovement solutions to help individuals and organisations succeed.

The SAI Global business is driven by two equally important client needs - the mandated need fororganisations to conform to regulations, standards and legislation in all their locations, and the
mailto:[email protected]:[email protected]:[email protected]:[email protected]


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operational need for organisations to improve business processes and procedures as well ascorporate culture. As we are a global company, we can meet these needs for any client- thoseoperating within one country's borders and in one language or those operating across borders andin many languages.

There are three business units/divisions within SAI Global namely the Information ServicesDivision, the Compliance Division, and the Assurance Division. The Assurance Division helpsorganisations manage risk, achieve process or product certification and drive improvement byproviding training, registration audits and supplier management programs that can improvebusiness performance. We provide independent audits, assessments and certification of yourproducts or business processes to ensure they comply with industry standards or customer specificrequirements. We understand how compliance with those standards can improve the efficiency,economy and profitability of your operation. With auditing and assessment staff located around theworld, our clients include large global corporations as well as single site organisations.

2.2 Audit methodology

SAI Global performed a pre-audit to RSPO Principles and Criteria on 9 March 2011 to review PT.Socfin Indonesia Tbk.s RSPO system, confirm the scope for certification, determine organisationspreparedness for Stage 2 (Certification) Audit; review the adequacy of the SAI Global auditprogram and resources for Stage 2 (Certification) Audit including confirming and preparing the draftaudit plan.

The Certification Audit was performed on 10 to 12 and 16 May 2011. The audit programme wasincluded in the body of report. The audit methodology for collection of objective evidences is siteinspection, documentation and record review and interview with staffs, workers, and other

stakeholders. Objective evidences from documentation/record review in one area may also becross checked with other objective evidences in other areas and with the evidence ofimplementation on site during the audit. Inputs from stakeholders via letter, email, or othercommunication media were also considered for this certification audit.

2.3 Qualification of the lead auditor and audit team member

Ria Gloria Lead Auditor

Ria Gloria graduated with Bachelor of Chemical Engineering degree from Bandung Institute of

Technology in 1994. She has working experience as Environmental Consultant for many years.She has completed ISO 14001 (1995), ISO 9001 (2004), and RSPO (2009) lead auditor trainingcourses, and SCCS (2010). For the last 8 years she has been involved in quality (ISO 9001) andenvironmental (ISO 14001) management system audits for very broad industrial and in the palm oilsector since 2003 for several plantations and mills. She has received training for good agriculturalpractices including integrated pest management and high conservation value (2008-2009).

Inge Triwulandari Audit Team Member

Inge Triwulandari graduated with Bachelor of Chemical Engineering degreefrom Bandung Institute

of Technology in 1996. She has completed ISO 9001 (2000), ISO 14001 (1997) lead auditortraining courses, RSPO auditor (2008), and SCCS (2010). For the last 12 years she has beeninvolved in quality (ISO 9001) and environmental (ISO 14001) management system auditsincluding in the palm oil sector since 2006 for several plantations and mills. She has receivedtraining for good agricultural practices including integrated pest management and highconservation value (2008-2009).


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Sigit Yulianto Audit Team Member

Sigit Yulianto graduated with Bachelor of Metallurgical Engineering degree from University ofIndonesia in 1993 and Master of Occupational Health and Safety from the same university in 2006.He has working experience in the manufacturing industry for many years. He also certified OHSExpert in Indonesia. For the last 14 years he has been involved in quality (ISO 9001) andoccupational health and safety management system audits for very broad industrial and servicesectors including in the palm oil sector since 2008 for several plantations and mills. He hasreceived training for good agricultural practices including integrated pest management and highconservation value (2008-2009).

Fadjar Deniswara Audit Team Member

He graduated with Bachelor of Industrial Engineering degreefrom National Institute of Technologyin Malang. He is a Lead Quality Auditor for ISO 9001:2008 with SAI Global and registered inRABQSA. He has anexperience for more than 11 years in auditing. He has an experience in auditwith company with labour intensive type (e.g. textile, garments, shoes, etc). He has also registeredas SA 8000 certified auditor. He has received training for good agricultural practices includingintegrated pest management and high conservation value (2008-2009).

Irawan Y Bawono Audit Team Member

Irawan Y Bawono graduated with Bachelor of Food Technology from Gadjah Mada University on1992. He has completed ISO 9001 (2008), ISO 22000 (2005) lead auditor training courses, RSPO

auditor (2008), and SCCS (2010). For the last 5 years he has been involved in quality (ISO 9001)and food safety management system (ISO 22000 and HACCP) audits including in the palm oilsector since 2007 for several plantations and mills. He has received training for good agriculturalpractices including integrated pest management and high conservation value (2008-2009).

Resit Szer Technical Specialist for HCV Issues

Dutch nationality Biologist, since 1994 active in Indonesia in the field of Endangered Speciesresearch (Bornean Peacock Pheasant, Javan Hawk-eagle), Endangered Species surveys(Sumatran Rhino, Orang Utan, Javan Tiger), habitats surveys (conservation areas, HPH, oil palmplantations), wildlife trade surveys, wild animal rescue, reintroduction and restocking of wildlife,endangered species breeding programs (Bornean Peacock Pheasant, Javan Warty Pig, Black-winged Starling), scientific publications and community involvement.

2.4 Stakeholder consultation

Stakeholder consultation was performed to internal and external stakeholders. Internalstakeholders included staffs and workers. External stakeholders were notified by placing aninvitation to comment on the RSPO, PT. Socfin Indonesia and SAI Global websites.

Letters were sent to individual stakeholders and telephone calls were performed to arrangemeeting. Meetings and interviews with stakeholders as part of the audit were held. Externalstakeholders included governments, NGO and civil societies who have an interest in theorganisation area and resident communities. Consultation with interested parties was conductedduring audit, some of interview concern to social aspect and HVC.


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List of stakeholders contacted

Workers and Staffs

Ramaya Personnel of spraying

Sawaliyati Personnel of Fertilizing Daniel Saragih Personnel of Harvesting

Suaryadi Personnel of Harvesting.

Ridwan A Siregar Chairman of Labour Union Chairman

Sugiyono Secretary of Labour Union

Local community and Government

Ishak Iswamto Head of Bantan Village

Masna Secretary of Bantan Village

Kamin Secretary of Kerapuh Village

Sri Wahyuni Government Supervisor

BudiYakin Farmer Group

2.5 Date of next surveillance visit

The next surveillance visit will be one year from approval of this report by the RSPO.

3.0 AUDIT FINDINGS

3.1 Summary of findings

As mentioned in above, objective evidences were obtained during the certification assessment forthe entire RSPO indicator for 1 Mill and 1 Estate. The evidences for each major and minor indicatorfrom each of these operational areas were aggregated to provide overall findings. Statements wereprovided for each of the Indicators to support the finding of the assessment team.

During audit, 50 minor nonconformities against minor compliance indicators and 8 opportunities forimprovement were issued. Detail of minor nonconformities and opportunities for improvement wasprovided in the body of report.

PRINCIPLES 1: COMMITMENT TO TRANSPARENCY

Criterion 1.1 Oil palm growers and millers provide adequate information to otherstakeholders on environmental, social and legal issues relevant to RSPO Criteria, inappropriate languages & forms to allow for effective participation in decision making.

Information request and their respond were determined in the procedure SOC/PSM/9.01 socialcommunication. Communication procedure was established and implemented by the organisation.Communication procedure described follow up of information request from interested party. Allrequest from stakeholder directly respond by the organization.

Records of information request from stakeholder were kept by Mill and Estate. Most of request wasinitiated from community around Estate (School Principal, Village Head, Village Institution) andalso some request from Labour Department (Dinas Tenaga Kerja) and BPS (Central Bureau ofStatistic/Biro Pusat Statistic). Some of requests are pertinent to information labour data from DinasTenaga Kerja, production report from BPS and donation request from village head and village


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institutiom, and it was used for social activity for community around Estate.

All information request from stakeholder was listed and recorded by Mill and Estate. Record ofinformation and respond was kept by the organisation. Retention time for records was determined

minimum 5 years.

Criterion 1.2 Management documents are publicly available, except where this is preventedby commercial confidentiality or where disclosure of information would result in negativeenvironmental or social outcomes.

SOC/PSM/9.01 dated 01 April 2011 was established to respond the request the public in regardthe legal documents. The form to record the respond and associated follow up on respond hasbeen established. It was reported that so far no request from public in regard legal documents. Theretention time on such record is 5 years.

Management documents which arepublicly available have been available, e.g. HGU (Land UseTitle), Plantation Operation Permit, ANDAL (Environmental Impact Analysis), RKL (EnvironmentalManagement Plan), RPL (Environmental Monitoring Plan) and CSR Program.

Initial Environmental Impact Assessment documents (ANDAL, RKL and RPL) which wereapproved by Department of Agriculture of Republic of Indonesia on May 24, 1994 for BangunBandar Mill and Estate were available. The document was revised and approved by Head ofSerdang Bedagai District Environmental Agency on June 20, 2005. The revised RKL and RPLwere available at Bangun Bandar Mill and Estate. It was informed that the document will beavailable to the stakeholders on request.

CSR programs were available. The CSR program involved estates community. Activity plan foractivity for year 2011 was available and approved by the top management. Social activity report foryear 2011 was made. Some of activities were conducted such as road repairs, book donation toschool, etc. Public comments are welcome for CSR program and their requesting included inannually CSR program.

Opportunity for improvement

It could be considered using forms that required in the procedure SOP/PSM/9.01 forinformation and respond from stakeholder although information request was followed upwith respond.

It could be considered to evaluate CSR programs that were conducted by mill and estate. Itis needed to review effectively of CSR program from mill and estate.

It could be considered to improve understanding from employees by conductingsocialisation of CSR programs and related RSPO procedure to all personnel at Mill andEstate. Based on the interview result, some of employee and staff did not fully understandRSPO procedures and CSR programs.

PRINCIPLES 2: COMPLIANCE WITH APPLICABLE LAWS AND REGULATIONS

Criterion 2.1 There is compliance with all applicable local, national and ratified internationallaws and regulations.

Evidence of compliance with applicable local, national and ratified international laws andregulations of Bangun Bandar Mill and Estate have been provided, including valid permits (wastewater discharge permit, river water and ground water abstraction permits, hazardous wastestorage permit, boiler and diesel generator permits), provision of required infrastructure (wastewater treatment ponds, hazardous waste storage), availability of MSDS, periodic environmental


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parameter monitoring (stationary emission, ambient emission and ambient noise, moving sourceemission, waste water discharge quality, and ground water quality), system of plant cultivation, oilpalm plantation, list of flora and fauna protected, management of guard area, minimum wage,labour law, occupational safety, employee social benefit. The records were sighted for period

January 2010 to March 2011.

Evidence of compliance with applicable environmental laws and regulations which concern theoperation of Bangun Bandar Mill and Estate has been already evaluated internally as required bythe procedure SOC/PSM/4.05. The procedure also describes mechanism for ensuring informationof applicable environmental legal and other requirements were accessed, reviewed and applied.Updating of law and regulations change activities were well documented, and last update wasperformed in October 2010. Information on applicable legal and other requirements have beenreviewed and summarised.

Evaluation of compliance was documented within Identification, Summary and Status ofCompliance. Last evaluation of compliance was performed in March 2011. There were some gaps

identified, including availability of river water flow meter, arrangement of waste water dischargepermit renewal, and utilisation of rain water against Ministry of Environment Decree #12/2009. Thegaps have been already completed with action plan that described action to be taken, delegation ofresponsibility and timeframe. The action plan for renewal of waste water discharge permit hasbeen settled in April 2011, where as two action plans remained open at the time of audit.

Minor non-conformance against criterion 2.1

No flow meter installed for measuring river water abstraction, and flow meter used formeasuring consumption of ground water has not been functioned since September 2010. Itwas informed that local authority has approved the estimation of river water consumption byusing ratio of total FFB processed monthly. However no documented statement from thelocal authorities regarding this matter, although that calculation of the retribution and

retribution payments were sighted. Several law and regulations have not been included in evaluation of compliance with law

and regulations performed in March 2011, e.g. ground water abstractions permit, rivermanagement against Government Regulation #35/1991 and limited pesticide use based onMinistry of Agriculture Decree #7/permentan/sr.140/2/2007. In practice, these law andregulations have been complied.

The result of evaluation of compliance with regulation Act No. 3/1992 in regards employeesocial benefit was reported complied to. In fact not all requirements have been complied,e.g. in regard to employee social benefit for non permanent employees.

Criterion 2.2 The right to use land can be demonstrated, and is not legitimately contested bylocal communities with demonstrable rights.

The legal documents showing ownership and operation for Bangun Bandar Estate were evident,i.e.:

The land use title:o HGU #2o Total area: 4,146.85 Hao Make reference to land situation map #76/04/IV/1997, dated January 23, 1997o Valid to December 31, 2023

Plantation operation unit:

o Decree #HK.350/821/Dj.Bun.5/XI/2011o Total area: 4,146.85 Hao Palm Oil Mill: Permit capacity: 25 ton FFB/hour, Installed capacity 23 ton FFB/hour

Legal boundaries (peg) were indicated on land situation map. There a total of 85 pegs on the map.


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The availability of peg on plantation area was verified by sampling and found satisfactory and wellmaintained.

Figure 2 Boundaries Pegs with Estate name

There is no land conflict in Bangun Bandar Estate. Conflict settlement mechanism was describedin the Procedure: Identification and Land Compensation Calculation SOC/PSM/9.05.

Criterion 2.3 Use of land for oil palm does not diminish the legal rights, or customary rights,of the other users, without their free, prior and informed consent.

Planted areas of the estates are wholly on Government land, leased under HGU as indicatedabove. No land settlement for the estate area mentioned above. Maps have been developed forestate indicating Legal demarcation and planted areas.

PRINCIPLES 3: COMMITMENT TO LONG-TERM ECONOMIC AND FINANCIAL VIABILITY

Criteria 3.1 There is an implemented management plan that aims to achieve long-termeconomic and financial viability.

The long term plans for period 2011 to 2013 have been established. Key indicators have beenincluded in the long term plan which include crop projection = FFB yield trends, FFB yield/ha/year(2011: 26.69, 2012: 26.06 and 2013: 24.92), mill extraction rates = OER trends, Cost of Production= cost per tonne of CPO trends, forecast prices and financial indicators. Implementation of the longterm plan is monitored regularly to ensure key indicators are achieved and cost do not overrunfrom targeted projections.

The long term plan for renewing parts of the oil palm plantation for the period 2011-2015 has beenprepared. This plan includes the conversion of a 34.5 Ha block of the companies Rubberplantation into oil palm plantation in 2011. Earlier, 438.7 ha of ex-Rubber plantation was already re-planted with oil palm in the Tanjung Maria Plantation, which actually falls under the same

concession license as Bangun Bandar Estate (HGU #2, February 1998).

The replanting plan for Bangun Bandar Estate has been established for period 2011 to 2015. Itwas noted the following replanting plan:

2012, Division 1


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2014, Division 1, 2 and 3

2015, Division 3

PRINCIPLES 4: USE OF APPROPRIATE BEST PRACTICES BY GROWERS AND MILLERS

Criterion 4.1 Operating procedures are appropriately documented and consistentlyimplemented and monitored.

The organisation has developed Standard Operating Procedures for Oil Palm Plantation inSOC/PSM/7.10 dated 1 February 2007. The SOPs consist of procedures for several processesincluding land clearing, nursery, preparation before replanting, fertilizing, drainage system,integrated pest management, maintenance of immature and mature upkeep and harvesting. Otherthan there were also other procedures, e.g. SOC-KKS/IK/00 for planting of oil palm, SOC-KB/IK/07for road maintenance, SOC-KB/IK/01 for fertilising, SOC/PSM/7.10.17 for water

management, SOC-KB/OK/02 for pesticide spraying.

Estate activities are programmed in annual program. Activities program are such as pest anddiseases census, fertilising, spraying, cleaning of trench and road maintenance. Estate Managerand Assistant check and monitor the activities at site regularly. Site observation was performedduring audit to some activities: fertilising, spraying, road maintenance, replanting, cleaning oftrench, caterpillar census, picking of larva, harvesting. Activities have been performed at definedinterval. Records of activities were sighted, e.g. Foreman Book, Daily Attendance and OvertimeSheet, General Workgroup Task, Data Collection Sheet. The record covered activities type,number of worker, quantity of agro chemical use, quantity of activities output and area of activities.

Standard Operating Procedures (SOP) has been established that describes processing and quality

control including its reporting from reception of fresh fruit bunch up to dispatch of Crude Palm Oiland Palm Kernel. The procedures are documented on SOC-POM/PSM/7.08 (FFB receiving), SOC-POM/PSM/7.09 (processing of CPO and palm kernel) and SOC-POM/PSM/7.06 (delivery). Workinstructions for supporting Mill activities were also sighted: SOC-POM/IK/01 to SOC-POM/IK/16 forloading ramp, sterilizer, hoisting crane operation, stripper, screw presser, continuous tankoperation, purifier, vacuum dryer, decanter, sludge separator, fat pit operation, nut silo, nut cracker,separating tank, kernel silo, and clay bath.

FFB that processed by Bangun Bandar Mill is received from own Estate (Bangun Bandar Estate)and the third party, Kelompok Tani Yakin as independent smallholder. The third party was notincluded in the scope of certification. The organization has established RSPO Certification Policyfor Independent Smallhorders which was signed off by Top Management on 16 May 2011. Theproportion of FFB from own Estate is around 50% of all. All of the FFBs are processed in samefacility (Bangun Bandar Mill). See the capacity on scope certification above.

Bangun Bandar Mills CPO and palm kernel mostly delivered to FRF (Fractionation & RefineryFactory) of PT. Socfin Indonesia Tanah Gambus and local customer such as PT Musim Mas. All ofPalm kernel is delivered to PKOF (Palm Kernel Oil Factory).

A review operation daily report (January May 2011) and site observation found that in general thedocumented procedures described above has been consistently implemented and monitored, withfew exceptions. FFB is graded according to the quality. Grading is recorded in FFB Receivingfrom Estate. Item records were date and hour received; block estate, division, weight and quality.

The record is input to ERP system; Harvest Plus. Rejected FFB is returned to supplier (only forthird party FFB) and the good FFB then transferred to loading ramp. FFB then loaded onto lorryand go to sterilization unit. Sterilization processes was shown under control with regard to the cycletime of thermal process and pressure. Three peaks system with the pressure 2.8 - 3 kg.cm2 for 75minutes was applied. All units are equipped with calibrated pressure gauge. Calibration tag wassighted. The sterilization activity is recorded on daily report.


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After sterilization FFB then come into threshing process by releasing of the palm nut from the fruitbunch by monitoring the speed of feed, digesting, cutting up the palm by controlling thetemperature. Released fruit then digested and pressed to get oil and release the fibre from nut.

Process control is conducted by controlling the pressure and temperature. It was noted thetemperature and pressure have been monitored and recorded. The thermometer and pressuregauge are calibrated regularly. Filtering, clarification and purification process then follows beforethe CPO pumped to crude oil tank. Vibrator filter, clarification process and vacuum is applied afterthat before the CPO pumped to daily tank.

The palm kernel process reviewed include nut silo operation, ripple milling, clay bath operation,kernel drying, and kernel storage. Nut is dried by using blower and steam elements. Severalparameters to be controlled are temperature and water content. Clay bath is used to segregate thepalm kernel from the clay. The parameter to be controlled is the density of clay. It was observedthat kernel temperature and moisture as well as the process parameters were within thespecification.

Delivery of CPO and palm kernel is conducted according to DO (Delivery Order) sent from sales atMedan Head Office. In general, records reviewed found that this activity has been doneappropriately as described by internal procedure.

In process quality inspection and the final product inspection is conducted by laboratory which isunder PSBB and the daily record is sent to Mill. Compliance to the specification was observed.


It was observed during site observation that the recording of sterilization was not conductedas actual condition. The steam sterilizer #2 was down however it was not recorded onRototherm report.

Working Instruction for Sounding has not been established. Sounding reporting was not conducted in appropriate manner. Only one sounding record is

reported on the daily report.

Thermometer used for sounding has not been calibrated.

Water analysis is done with not appropriate equipment. There was no scale on the pipeused for titration of water alkalinity.

Criterion 4.2 Practices maintain soil fertility at, or where possible improve soil fertility to, alevel that ensures optimal and sustained yield.

Soil and leaf sampling is analysed regularly to determine the nutritional status of soil, to assist andto be guided in the preparation of annual fertilising programme recommendation. Procedure of soilanalysis SOC/PSM/7.10-15 dated 1 March 2011 mentioned that soil is analysed every 5 years.Procedure of leaf sampling SOC/PSM/7.10-16 dated 1 March 2011 mentioned that leaf is analysedannually two months after the first application. Method of sample taken and preparation of analysiswas described in the procedure. Last soil and leaf sampling analysis was conducted by theexternal laboratory. Soil analysis was conducted by Param Agricultural Soil Surveys (M) SDN.BHDand leaf sampling analysis was conducted by CIRAD (Centre de coopration internationale enrecherche agronomique pour le dveloppement). Last report of soil analysis was issued inFebruary 2007 and last report of leaf analysis was issued in June and July 2010. Method of soilsampling during analysis in 2007 was not clear. The method of sample taken was improved and

described in the procedure. Schedule of soil analysis has been established. Next soil analysis isconducted in 2012.

Visual analysis of leaf is conducted by staff from Socfin Medan Head Office during site visit toEstate. Schedule for site visit to Estate was sighted. Visual analysis was conducted in January


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2011. Result of visual analysis was reported in Nutritional Status of the Palms and Field Visit ofBlocks. Report included observation result and its recommendation for improvement.

Fertilising programme was developed by Agriculture Department in Socfin Medan Head Office

assisted by CIRAD as consultant for all Division of Estate based on result of soil and leaf samplinganalysis. PT. Socfin Indonesia does have own research institution. Fertilising programme coversarea and time of application and type and dosage of fertiliser. Fertilising is performed manually.Result of fertilising was well recorded including date of application. It was noted that most offertilising activity in the first semester has been applied. For the block which is replanted in 2012was not fertilised. Fertilising activity was described in SOC-KB/IK/01.

Legume cover crops (LCC) are grown to protect soil from erosion, improve soil fertility and controlweed. The LCC grown is Mucuna brachteata. LCC is maintained through manual maintenance(cleaning from weed), fertilising and agro chemical spraying. Rock phosphate is used as fertiliser togrow LCC. LCC growth is monitored regularly. Fertilising program for LCC was sighted includingthe realisation.

Empty fruit bunches (EFB) are applied in mature upkeep. Quantity and area applied was based onrecommendation from Agriculture Department in Socfin Medan Head Office. EFB application wassighted. Area of which EFB applied was monitored.

Land application of POME was not applied in the Estate.


Last soil analysis was reported in February 2007. Report mentioned that not all divisionswere analysed. Criteria of soil analysed and location coverage of sampling point was notclear.

Criteria 4.3 Practices minimise and control erosion and degradation of soils.

Map of soil for Bangun Bandar Estate were available and documented in Soil of Bangun BandarOil Palm Estate issued by Param Agricultural Soil Surveys (M) SDN.BHD in June 2004. Map ofsoil mentioned that there were no fragile soils, there was only 3.5% of area is poorly drainage and2.50 ha is peat soil. Bangun Bandar Estate has slopes 0 to 45%.

Work instruction SOC-KKS/IK/00 dated 1 November 2009 describes preparation for plantingincluding planting on slopes area. The organisation do not recommend plantings on slopes >60%.System for planting on slopes area is provided through terracing, levelling of terrace, anddetermining of planting space. To minimise and control erosion in slope area, several practiceshave been implemented such as terracing and growing of legume cover crops.

Procedure of road maintenance is described in SOC-KB/IK/07. Estate has established annual roadmaintenance programme for government road, primary road, and secondary road. Roadmaintenance in Bangun Bandar Estate was conducted manually. Besides according to annualprogram, road maintenance activity was also conducted according to road condition. Record ofroad maintenance realisation was sighted included block of plantation maintained and distance ofroad maintained. However it was several parts of road was not well maintained.

It was noted that there is peat soil area of ca 2.5 ha was encountered in block 68. Althoughprocedure to manage peat soil has been established in SOC-KB/IK/08 however there is no

subsidence of peat soils minimised under an effective and documented water managementprogramme.

The organisation has procedure of soil erosion control on marginal land at mature planting. Theprocedure mentioned that soil erosion in mature upkeep is monitored every three months. It wasnoted that several blocks have slope 45% and the area was still immature. Soil erosion monitoring


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Bangun Bandar Mill has established Water Management Plan, SOC/PSM/4.22, which was issuedin October 2010. The plan described identification of water supply and arrangement of anynecessary permit, measurements of water consumption, and water distribution. It was sighted that

currently there were two water supplies for Bangun Bandar Mill: river water and ground waterwhich currently still held valid permit from relevant authorities. All rivers were categorized as HCV1.1 and HCV 4.1. This was discussed in criterion 5.2.

The water supply, distribution and consumption were described in water management document,SOC/DP.4.22-01. Water consumption for boiler feed-water was sighted; daily supply to boiler wasrecorded based on flow meter reading. Other water consumption was currently monitored throughestimation based on ratio of processed FFB. Total Mill water consumption and boiler waterconsumption was reported monthly by Bangun Bandar Mill to Medan Head Office.

As mentioned previously above, monitoring of mill water consumption per ton of FFB was based onratio of processed FFB. However the water consumption data used to estimate Mill water

consumption was from River Water instead of Ground Water. The Water Management Plandescribed that river water was used for supply of boiler feed water and mill water consumption wassupplied from ground water.

Environmental Monitoring Plan requires that quality of waste water discharged from BangunBandar Mill waste water treatment ponds are monitored monthly including BOD. Evidence ofmonitoring of BOD was reviewed for period January 2010 to March 2011 against environmentallimit required by Environment Ministry Decree #Kep-51/MENLH/10/1995 annexure B-IV; howeverrecord of BOD for several months were not evident during audit.


Quality of Martebing and Belutu Water River is being analysed by Laboratory of North

Sumatera District Environmental Agency. Water sample was sent to the Laboratory on 13April 2011. Result of analysis has not been finished yet by the Laboratory.

No evidence of measurement of daily ground water abstraction as well as river water, asrequired by procedure water management SOC/PSM/4.22. Currently flow meter exists andfunctioned only for Boiler feed-water. The flow meter exists for measuring ground waterconsumption has not been functioned since end of September 2010.

Monthly monitoring data of Mill water consumption per ton of FFB was not accurate(January 2010 to April 2011), e.g. water used for Mill was actually from ground water, butdata reported was from river water.

BOD of effluent is required to be monitored monthly. However result of BOD monitoring ofwaste water treatment ponds effluent in March 2010 and December 2010 could not be

found during audit.

Criteria 4.5 Pests, diseases, weeds and invasive introduced species are effectively managedusing appropriate Integrated Pest Management (IPM) techniques.

Procedure for IPM to control pests, diseases and invasive introduced species has beenestablished in SOC/PSM/7.10-13 for IPM of Caterpillar and Bagworm Attack, SOC/PSM/7.10-11for IPM ofOryctes rhinoceros, circular letter #Tan/Keb.KS/Bi/88/2005 dated 6 May 2005 for IPM ofrodent. These procedures include setting out of technique to be implemented, chemical to be used,locations to be applied, and time frame for implementation. Program for IPM is established

annually. IPM programme includes pest and diseases detection, census and controlling, use ofpesticide and herbicide.

The implementation of IPM is monitored. Census of caterpillar is conducted regularly to determineits controlling. Controlling is performed based on level of attack. There are three levels of attack:low, medium and high. Result of census was recorded including area of census, type of caterpillar,


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quantity of caterpillar and level of attack. Use, dosage and concentration of agro chemical wasalso recorded when controlling of caterpillar was applied by agro chemical spraying. One ofcontrolling of Oryctes rhinoceros is through picking of Oryctes rhinoceros and its larva. TheOryctes rhinoceros and its larva was conducted at the decayed parts of such palms, the palms

naturally fallen and the palms still standing but presenting rotten tissues at the bottom. Thecontrolling was conducted in immature upkeep and land clearing area. Quantity of Oryctesrhinoceros and its larva was recorded. Census of Oryctesrhinoceros is also performed regularly.Result of Oryctes rhinoceros attack and map of attack was sighted. Agro chemical spraying isperformed ifOryctesrhinoceros attack are higherthan the critical point.

Figure 4 Result of picking ofOryctesrh inoceros and its larva

Training of IPM has been performed to Division Assistant, Pest Foreman, and Census Foreman.List of participant attendance was sighted.

Pesticide toxicity units (a.i. / LD 50 / FFB tonnage) have not been monitored to active ingredient.The organisation requested the external laboratory to analyse the residue of active ingredients (i.e.deltametrin, sipermetrin and -sihalotrin) of agro chemical in FFB and CPO. The result mentionedthat the active ingredients were not detected in FFB and CPO.


There was no monitoring extent of IPM implementation regarding growth and length ofbeneficial plants.

Training of IPM implementation has been conducted to one of four assistant and foremen. It

was noted that the assistant was moved to other Estate. The three other assistants havenot been trained regarding IPM implementation.

There was no monitoring of pesticide toxicity units (a.i. active ingredient / LD50 per tonne ofFFB or per hectare).

Opportunity for improvement

Although IPM techniques regarding rodent has been developed in the circular letter, it couldbe considered to establish the IPM techniques in the documentation system.

Criteria 4.6 Agrochemicals are used in a way that does not endanger health or theenvironment. There is no prophylactic use of pesticides, except in specific situationsidentified in national Best Practice guidelines. Where agrochemicals are used that arecategorised as World Health Organisation Type 1A or 1B, or are listed by the Stockholm orRotterdam Conventions, growers are actively seeking to identify alternatives, and this isdocumented.


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Agrochemicals used by Bangun Bandar Estate has been registered and licensed by AgricultureDepartment, e.g. Round up 486 SL license RI 01030120001560 expired on 18 March 2016,Gramoxone 276 SL license RI 36/8-2006/T expired on 8 September 2011, Ally 20 WDG license

RI 837/4-2009/T expired on 30 April 2014, Metaprima 20 WDG RI 1897/7-2008/T expired on 7August 2013. It was noted that there were no agrochemicals being used which are not on thisregister during this audit. Agrochemicals use and their register number refer to PesticideCommission Book Buku Komisi Pestisida.

Agrochemicals used have been recorded including active ingredient used, area treated, amountapplied per ha, use of selective product and number of applications. Several record of pesticideused was sighted, e.g. application schedule, list of pesticide use in oil palm estate, workachievement and pesticide use, stock card of agrochemicals. The record covered date ofapplication, quantity of pesticide use and name of sprayers. The records were sighted in allDivisions.

During audit, spraying of weed was observed in Division #1. It was noted that pesticides(gramoxone and ally) used was registered agrochemicals. Dosage of pesticides use, target weedwas inline with circular letter #TN/SE/KS/Bi/020/2007. It was noted that agrochemicals used wereinline with target pest, weed or disease, determined dosage, and applied by qualified person. PPEused during spraying of pesticides are boots, apron, safety glass, respiratory mask and handgloves.

Agrochemicals have been applied by qualified persons who have received usage of limitedpesticide training. Training was delivered by supplier on 28 September 2010 and by NorthSumatera Health Department and Pesticide Commission on 4 April 2011. Training record wassighted for all sprayers in all estates. Training covered handling of concentratechemical/agrochemical and spraying method including pesticide hazard.

Agrochemicals are stored in the determined area separated from fertiliser and other chemicals.Agrochemicals storage is provided in each Division. Agrochemicals storage is locked areas withlimited access. The storage is ventilated through cross flow ventilation. MSDS and hazard symbollabel are provided nearbyof agrochemicals. Emergency shower and eyewash are also provided toanticipate in case of an emergency of chemical handling. PPE for handling of chemicals areprovided including boots, apron, safety glass, respiratory mask and hand gloves. The possible spillis managed. Secondary containment is provided around the chemical storage area. Spill kit wasalso provided in the area. EHS patrol was regularly performed monitor possible spill.

Prior to be used in the field, agrochemical was diluted in Division Office. There is a designatedarea of mixing which was completed with roof, secondary containment and information of

agrochemical hazard. The area is also used for cleaning the agrochemical containers and fertilisersacks. Notice is displayed in the area treated with highly toxic pesticides, e.g. pesticideswarehouse and facility to mix agrochemical.


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Figure 5 Facility to mix agrochemicals

Handling of empty agrochemical containers was described in procedure SOC/DP/4.10-01. Allempty agrochemical containers were triple rinsed and destroyed prior to be disposed in thedesignated area and separated with organic and inorganic waste landfill. Records of chemicalcontainers quantity disposed and photograph of disposal activity were evident. The other emptyagrochemical containers can be reused during spraying.

Paraquat is still used in Bangun Bandar Estate. Data of paraquat used is provided since 2003. Itwas observed that paraquat use was fluctuated year to year. Agriculture Department of SocfinMedan Head Office has defined 20-25% reduction of paraquat use for Bangun Bandar Estate in2011. Each division has established monthly program of paraquat use to ensure that paraquat use

is controlled and reduced. The realisation was reported to Agriculture Department of Socfin MedanHead Office to control paraquat use.

There are medical checks up to all workers. Medical check up for agrochemical operators isconducted annually. Medical check up 2011 was sighted for all agrochemical operators in BangunBandar Estate. Results of medical check up in general were good.

Ethic policy mentioned that no work with pesticides for pregnant and breastfeeding women. Alldivisions still involve women as pesticides sprayer. To ensure that there were no pregnant andbreastfeeding women during spraying of pesticides, there are lists of women worker including dataof monthly checking conducted by nurses.


Agro chemical solution carried out to site was not completed with information of hazardnature of agro chemical.

Decis 25 EC with active ingredient Delta metrin was used within organisation. The agrochemical has had license from Department of Agriculture however the agro chemical hasnot been registered in the list of pesticide used within organisation.

Opportunity for improvement:

It could be considered to improve transportation system of agro chemical solution fromdivision warehouse to site, e.g. by layering with plastic on the transportation unit to preventagro chemical spill during transportation.

It could be considered to improve record of paraquat consumption, e.g. report thepercentage of target consumption.


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Criteria 4.7 An occupational health and safety plan is documented, effectivelycommunicated and implemented.

It was noted that Bangun Bandar Mill and Estate has been certified to occupational health and

safety management system based on OHSAS 18001: 2007 by SAI Global.

Occupational health and safety policy has been established and has signed by the highestmanagement level. The policy statement includes the commitment to prevent injury and ill health,to comply with regulation and for continual improvement. The policy was made available foraccessing by employees and other stack holder and displayed on strategic locations of EstateOffice and Mill Office.

Occupational health and safety target and programme are established annually for Mill and Estate.The target and programme 2011 was sighted with the main target and programme was inregard tozero accident and zero ill health.

Asafety committee has been established and already approved by local authority. The chairman ofthe committee is the highest level management of estate and the secretary of the committee is theOHS expert (AK3U) and the member consists of representative of each section. OHS expert isalso a safety officer and actsas a representative on health and safety. The Safety Committee isresponsible for the OHS programme and its implementation. Monthly meeting was held by SafetyCommittee to review the progress and implementation of OHS programme. Results of the meetingincluding the recommendation and action plan were recorded in the minutes of meeting - thesewere sighted during the audit.

In the employees level, a daily briefing is performed by supervisor to his/her members. In thisevent, the supervisor provides briefing on the issues of production including health and safetyissues such as the use of PPE and accident prevention. Health and safety inspection was

performed by the Safety Officer to identify any unsafe acts and conditions and PPEs used.Records of health and safety inspections were sighted.

The hazard exists in the operations and activities of Mill and Estate were identified and the riskswere assessed using documented risk assessment methodology. Hierarchy of control principlewas applied to determine risk control. It was noted that most risks were controlled by combinationof establishment of procedure or work instruction, safety signage and the use of PPE. Sightedprocedures or work instructions were included for estate activities such as planting/re-planting,fertilizing, insecticide, herbicide and pesticide spraying, road maintenance and harvesting, clinicand warehouse.

Division warehouse were observed during the audit. MSDS and hazard symbol label were provided

nearbyof chemicals. Emergency shower and eyewash was also provided to anticipate in case ofan emergency of chemical handling. PPE for handling of chemicals were provided including boots,apron, safety glass, respiratory mask and hand gloves. Fertilizer warehouse has a good aircirculation.

Several activities of estate were observed during the audit e.g. spraying and harvesting. Theworkers for spraying were provided with PPE including boots, apron, respiratory mask, safety glassand hand gloves. Hazard symbol label was provided at the container ofpesticide/herbicide/insecticide. Interview with workers indicated that they have a goodunderstanding on hazard and risk of their work. Interview with workers also indicated that theywere provided by the organisation with the medical facilities (clinic or referred hospital). The

supervisors were provided with first aid kit.

Transportation and heavy vehicles for Estate activities such as tractor, trailer and grader wereregularly maintained. The operators (drivers) were found having license from local authority (SIO).

Workers were staying at the estate housing. They were using motorcycle for reaching the worksite.


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They were using helmet for safety reason and the motorcycle was maintained. Transportation(truck) and heavy vehicles for Estate activities such as tractor, trailer and grader were regularlymaintained including the safety devices. The operators (drivers) were found having license fromlocal authority (SIO). Road inside estate was continuously maintained for safety and productivity

purpose.

Workshops were available at Mill. Small compressor tanks were certified by local authority. Gascylinders were placed and chained to prevent unintended fall and also provided with flash backarrester (non-returnable valve). PPE for welder was appropriately provided. Welders were alsocertified by local authority. The fuel tank was also available. Hazard symbol label was provided atthe tank. Fire extinguishers were also provided appropriately.

As for Bangun Bandar Mill, the risk assessment has been conducted; sighted records including forreceiving and handling of FFB, sterilizer, boiler, crane operation, conveyor, cleaning of CPO tank,maintenance and workshop, laboratory. Procedure and work instructions were also established tocontrol the operation including controlling the risk. Evident of risk control were sighted e.g.:

Boilers were tested and certified in accordance to local regulations. Regular maintenancewas also performed except for finding below. Process parameters of boiler operation wasestablished, controlled, and recorded. Boiler operators were certified by local authority.

Regular maintenance was also performed and the operators were also certified and trainedin accordance with local regulations.

Pressurized vessels (sterilizer, compressor tanks) were tested and certified in accordanceto local regulations and completed with safety valve and pressure gauge.

Fuel tanks were completed with secondary containment and fire extinguishers.

Lock Out Tag Out procedure was in place and implemented especially for maintenanceactivities.

Permit to Work procedure was also established and implemented for high risk activities andwork of contractor. Workers were wearing appropriate PPE.

Safety signage was properly provided at locations of Mill.

Most stair/ladders were provided with the hand rail.

Regular monitoring and measurement of workplace environmental was performed includingfor dust level, noise level, illumination level, temperature, humidity.

The organisation provides accident insurance to employees-however currently only for permanentemployee, see finding below. Clinic was also available to provide medicine and medical treatmentto employees and family.

The organisation policy mentioned to perform medical check-up annually to all employees. Medicalcheck up 2010 was sighted for Bangun Bandar Mill and Estate. Medical check were divided into

general medical check up to all employees and special medical check up to employees witchexposed to specific hazard (e.g. chemical, dust and noise). Parameters for medical check up wereincluding physical checking (dent, eye, skin, etc) and laboratory test (blood, urine, Rontgen,audiometric, spirometry). Results of medical check up in general were good and a few employeeshave been referred to specialist doctors for further checking, e.g. in regard hearing loss problem.Medical records were maintained.

The training inregard to occupational health and safety has been provided and sighted during theaudit including for OHS expert for Mill and Estate, first aid, spraying, emergency response andpreparedness, heavy vehicle operators, OHS socialization, chemical handling, manual handling,boiler operators, crane operators, etc. Training records were maintained. The contractors workerswere also trained during safety induction and training relating to work permit.

The procedure for emergency preparedness and response has been established. The proceduresinclude fire and explosion, toxically emergency, chemical spillage. The organisational structuresemergency response and preparedness were established at Mill and Estate. The organisationstructure mainly consists of commander, medical team, evacuation team, fire fighting. The


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contractor was occupied by the contract agreement. The requirement that the contractor providethe trained person was included in the contract, e.g. Contract with CV. Surya Baru for landclearing. The work permit system was established to control the work of contractor.

Minor non-conformance against criterion 4.8 The existing training requirements stated in personnel qualification does not consist of

training related to HCV and social issues.

Training plan for 2011 has not been established. It was noted that some employees havenot completely follow the training stated in personnel qualification e.g. Spraying Supervisorand Processing Supervisor.

PRINCIPLES 5: ENVIRONMENTAL RESPONSIBILITY AND CONSERVATION OF NATURALRESOURCES AND BIODIVERSITY

Criterion 5.1 Aspect of plantation and mill management, including replanting, that haveenvironmental impacts are identified, and plant to mitigate the negative impacts andpromote the positive ones are made, implemented and monitored, to demonstratecontinuous improvement.

Initial Environmental Impact Assessment documents (ANDAL, RKL and RPL) which wereapproved by Department of Agriculture of Republic of Indonesia on May 24, 1994 for BangunBandar Mill and Estate were available. The document was revised and approved by Head ofSerdang Bedagai District Environmental Agency on June 20, 2005. The revised RKL and RPLwere available at Bangun Bandar Mill and Estate.

Bangun Bandar Mill and Estate implemented procedure for identifying environmental aspect and

evaluating its impact based on Environmental Management System ISO 14001:2004,SOC/PSM/4.04. The result of environmental aspect and impact identification and evaluation wasdocumented within Identification of Environmental Aspect, SOC/Form/4.04-01. As required by theprocedure, the information of environmental is reviewed and updated regularly. Last review andupdate of environmental aspect and impact register for Bangun Bandar Mill and Estate wasperformed on March 01, 2011.

Bangun Bandar Mill and Estate has ensured that all activities with significant environmentalimpacts were managed. Control measure were defined and implemented for ensuring that negativeenvironmental impact were prevented or mitigated. There were two types of control measuresdefined: engineering control and administrative control. Detail of control measure applied for eachactivity was described in Significant Environmental Aspect Management, SOC/Form/4.13-02,

which was last updated on March 01, 2011. The implementation of those control measures aremonitored during monthly environmental patrol and also round of internal audits.

Implementation of Environmental Management Plan and Environmental Monitoring Plan isreported quarterly in coordination between Bangun Bandar Mill and Medan Head Office. For 2010report was sighted for March 2010, August 2010 and December 2010, and March 2011. Thereports were submitted to North Sumatera and Serdang Bedagai District Environmental Agencycompleted with receipt note.

Criteria 5.2 The status of rare, threatened or endangered species and high conservationvalue habitats, if any, that exist in the plantation or that could be affected by plantation ormill management, shall be identified and their conservation taken into account inmanagement plans and operations

A High Conservation Value Management Plan has been prepared, and available at the site. Posters


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and sign boards concerning HCV areas and protected species are available in the necessaryplaces. All staff and employees are informed about HCV areas and ERT species.

Identification of any protected, rare, threatened or endangered species and HCV habitat has been

performed by Forestry Department of Bogor Agricultural Institute (IPB) for PT. Socfin IndonesiaBangun Bandar Estate. The HCV assessment performed in September to October 2009.

Appropriate measures to preserve rare, threatened or endangered species or high conservationvalue habitats have been taken in Bangun Bandar Estate. The organisation established procedureSOC/PSM/9.07 to manage HCV area. The HCV management and monitoring plan has beenprepared. It was sighted that the management and monitoring plan were consistent with theidentified HCV in the assessment report.

HCV 1.1, HCV 1.2, HCV 4.1 and HCV 6 were identified. HCV 1.1 and HCV 4.1 are located inriparian buffer zone of the Belutu River and Martebing River (38.32 Ha). Two species of birdsendangered based on red list of IUCN were identified, e.g. Alcedo euryzona and Pycnonotus

zeylanicus. Public cemetery was identified as HCV 6.

The HCV management and monitoring plan described measures taken for each HCV and itsmonitoring. Relevant laws were taken into account for determining appropriate measure includingGovernment regulation #7/1999, President Decree #32/1990, and Government regulation#35/1991. HCV management areas maps were established.

The riparian buffer of the Martebing River is currently well managed; civil-technical and naturalmethods are being used to slow down and even completely stop aberration in several sampleareas along this river, and a general management plan is in place to manage the threats ofaberration and erosion along the river. Pollution prevented by means of a > 25 meters buffer zonewhere the application of agrochemicals is prohibited.

Some areas along the Martebing and Belutu Rivers are occupied and cultivated by the localcommunity. However, during a Public Consultation meeting in August 2010 at Dolok Masihul sub-district, the local community leaders were already informed about the importance of HCV areassuch as the Riparian zones, and their goodwill to help to conserve these areas was expressedhere. In addition, sufficient sign boards are in place to urge people (workers and community) not todisturb the riparian zones, wildlife or the water bodies. These sign boards are regularly monitored(checked) and replaced, if necessary. The riparian zones are also being managed and monitored.

Bangun Bandar Estate has appointed HCV officer to ensure the implementation of managementand monitoring plan. The organisations HCV management plan has made specific reference to thethreatened species found to exist in the area (e.g. Alcedo euryzona and Pycnonotus zeylanicus).

The HCV management plan includes monitoring existence of threatened species, to providewarning sign (i.e. hunting is prohibited), to eliminate disturbance to the habitat of threatenedspecies. Monitoring records were sighted to ensure that management plan is implemented, e.g.warning sign and board monitoring, monitoring of nuisance, river water quality monitoring,availability of flora and fauna classified as HCV.


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Figure 6 Watershed Protection


Monitoring of nuisance to HCV area was conducted once in February 2011. Monitoring planmentioned that monitoring of nuisance to HCV area is conducted monthly.

Availability and condition of HCV 6 regarding public cemetery was not monitored.

Criterion 5.3 Waste is reduced, recycled, re-used and disposed of in an environmentally andsocially responsible manner.

Identification of waste and pollution sources from Bangun Bandar Mill and Estate activities wasevident. The source of pollution and type of waste was documented within Identification ofEnvironmental Aspect, SOC/Form/4.04-01.

Procedure waste handling was established and implemented, SOC/PSM/4.11. The procedurerequired waste to be segregated from point of generation. In addition Mill and Estate also requiredto established Waste Register, SOC/Form/4.11-01, which described wastes generated from eachactivity/location, its classification (organic, inorganic or hazardous), and its control measure.

Empty agrochemical containers from Estate activities were cleaned using a triple rinse method.Empty agrochemical cans and bottles were disposed to landfill and separated from organic andinorganic. Quantity of empty agrochemical cans and bottles disposed was recorded andphotograph of empty agrochemical cans and bottles landfilling was sighted. Empty agrochemicaljerrycans were reused for chemical solution during spraying. Fertiliser sacks were cleaned prior tobe reused for piece of FFB layer during harvesting. Quantity of empty agrochemical jerrycanscleaned fertiliser sacks cleaned was recorded. All Divisions in Bangun Bandar Estate have beencompleted with area to clean hazardous chemical containers and fertiliser sacks. Liquid waste fromcleaning was reused for chemical dilution during spraying.

EFB, solid from decanter, and boiler ash were used for fertiliser in Bangun Bandar Estate. Fibre

and shell from Bangun Bandar Mill were used for boiler feed. It was observed that organic andinorganic waste was segregated at point of source. Mill and Estate including housing has provideddifferent colour of waste bin for each type of waste. Organic and inorganic wastes from Mill andEstate including housing were disposed to landfill in the Estate area. Disposal to Estate landfill wascompleted with weighing docket that described location of landfill and quantity of waste disposed.


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Hazardous wastes were collected, stored and disposed inline with Procedure SOC/PSM/4.11.Temporary storage of hazardous waste was available to collect hazardous waste prior to bedisposed to licensed vendor. Temporary storage of hazardous waste still held valid permit from

local government (#660/198.2/LH/2009). The hazardous wastes balance was made for each typeof hazardous waste: waste oil, waste battery, used fuel and oil filters, and medical waste. Disposalof hazardous waste were performed in coordination with Technical Department in Medan HeadOffice. Disposal of hazardous waste was completed with manifest. Manifest of disposal weresighted for 2010 period.


Several inconsistencies of waste management were identified (Estate):o Warning sign board regarding prohibition of waste burning was not provided in the

final disposal area of organic and inorganic waste.o During audit fibre waste was burned at site in block 48.o Organic and non organic wastes were mixed in the final disposal area of organic

and non organic waste.o Briefing regarding segregation of organic and non organic wastes is not conducted

monthly as required.

Some inconsistencies of waste management and hazardous material management wereidentified (Mill):

o It was found trace of waste burned at composting project area.o Vehicle/heavy equipment wash bay was not completed with silt and oil trap.o Although boiler chemicals provided with bund wall, some container of chemicals

were stored out of bund area.o Inconsistent use of hazardous waste symbol was found in front of general workshop

contaminated rags bin was not completed with hazardous waste symbol.o Waste battery was disposed in February 2011 through PT Bekasi Environmental

Service to CV Yudhi Raja Mandiri, however both vendors have no licenses to collectwaste battery.

o No evidence that vehicle used for transporting waste oil and waste battery fromBangun Bandar on February, 21 2011, BK8227ND, as documented in the disposalmanifests ZE005003 and YR000074 has valid permit for hazardous wastetransporting.

o Hazardous waste balance reported in February 2011 was not complete, onlycovered waste disposed to third party, but not covered hazardous waste stored andused.

Monitoring of quantity and use of boiler burner residue and clay sludge using economicwaste record SOC/Form/4.11-04 was not performed as required by procedure of wastemanagement SOC/PSM/4.11.

Volume organic and inorganic waste disposed to landfill using non-economic waste recordSOC/Fom/4.11-0 was not performed individually for each type of waste as required byprocedure of waste management SOC/PSM/4.11.

Criterion 5.4 Efficiency of energy use and use of renewable energy is maximised.

Fibre and shell was used as boiler feed. Volume of fibre and shell used for boiler feed is estimatedmonthly. Record sighted for January to April 2011. The quantity fibre generated from the Mill wasestimated about 12.5% of FFB processed and shell about 7% of FFB processed. Total energy

generated by steam turbine generator for Bangun Bandar Mill was recorded daily and evaluatedmonthly as total energy (kWH) per ton of CPO produced.

Fossil fuel used for Mill activities were recorded in the logistic system. Fossil fuel was used forheavy equipments and emergency diesel generator. Total fuel consumption is summarisedmonthly as litre of diesel fuel per ton of FFB processed. Record sighted for January to April 2011.


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of supplier and vendor to supply required inputs and or services. Specification of inputs and orservices required was communicated to the supplier/vendor through tender document or requestfor quotation. Contractual agreement was signed by both parties, including specification and workrequirements agreed.

Procedure SOC/PSM/7/07 was established and implemented for payment of suppliers andvendors. It was observed that payment was made consistent with term of payment stated in eachcontract or purchase order.

Criterion 6.11 Growers and millers contribute to local sustainable development whereverappropriate.

Records of organisation contribution to regional development was evident, among other levied inregion, agreement contract, and social assitance list. Some of activities were conducted by the

local contractors such as building houses, road maintenance (road hardening). Public commentsare welcome for CSR program and their requesting included in annually CSR program.

PRINCIPLES 7: RESPONSIBLE DEVELOPMENT OF NEW PLANTINGS

A procedure regarding responsible development of new plantings is in place (DocumentSOC/PSM/9.04). Bangun Bandar is a very old plantation, and therefore only replanting of Oil Palmand conversion from the companies Rubber Plantation into Oil Palm (within the same concession /licence area) is practiced here. No Primary Forest of HCV area has been present since long time,as this plantation was established during the Dutch period in the beginning of the 20 th century.

Since then, only implantable swamps consisting of bushes and shrubs, and riparian zones plantedwith oil palms remained, and these have all been identified as HCV areas. No other HCV areas orforests were present here between November 2005 and November 2007.

PRINCIPLES 8: COMMITMENT TO CONTINUOUS IMPROVEMENT IN KEY AREAS OF ACTIVITY

Criterion 8.1 Growers and miller regularly monitor and review their activities and developand implement action plans that allow demonstrable continuous improvement in keyoperations

It was sighted that several rounds of internal audits were performed to Bangun Bandar Mill. Internalaudit of integrated management system was performed as one of the requirements of ISO9001:2008, ISO 14001:2004 and OHSAS 18001:2007. Currently the implementation ofmanagement system audit was also covered requirements of RSPO Principles and Criteria, asdescribed in the internal audit procedure, SOC/PSM/8.02. The internal audit of managementsystem and RSPO requirements is programmed and performed annually under coordination ofMedan Head Office. Negative findings identified were followed up by issuance of corrective actionrequest. The corrective actions made were verified for its effectiveness. Last internal audit ofintegrated management system was performed in March 2011.

Other round audit performed for monitoring of Mill activities were conducted through operationinternal audit for ensuring compliance and efficiency. The findings made were mandatory to beresponded by the Bangun Bandar Mill and reported to Top Management. The report and itsresponse were submitted to top management, i.e. 2010 and 2011 reports.

The overall performance of management systems and RSPO

RSPO Report-PT Socfin Bangun Bandar RSPO20008

Documents

Transcript of RSPO Report-PT Socfin Bangun Bandar RSPO20008